Microsoft has bought Nokia's mobile phones business for £4.6 billion.

The titanic deal will reshape the entire mobile technology landscape.

Despite slowly increasing sales of devices running its Windows Phone, Microsoft has struggled in the mobile devices market in recent years. It recently lost close to $1 billion on its Surface RT tablets, which were received poorly.

Meanwhile Nokia's once dominant position in mobile phones has been brought virtually to its knees after years of failing to respond to the advance of Apple's iPhone and Google's Android OS. Two years ago it made a decision to focus exclusively on Windows Phone with its Lumia line of smartphone devices - and again, despite gradually increasing sales it is yet to make a real dent in the market share of either Apple or Samsung.

The companies said in a joint statement that the deal will be finalised in 2014, and that in total about 32,000 of Nokia's employees will now work for Microsoft.

Nokia will also license its patents and its maps service 'Here' to Microsoft as part of the deal.

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  • Nokia 1011 (1992)

    Named after 10 November, the date it launched, this was among the world's first GSM mobile phones. Oddly enough, you could receive text messages but not send them.

  • Nokia 2110 (1994)

    The 2110 featured a 99-number phonebook, and a two-way scrolling control which meant you could actually navigate them. It was also the first phone with the signature 'Nokia' ringtone. You know the one... It was based on Gran Vals, a guitar piece by the 19th century Spanish composer Francisco Tarrega. Over time it was also highly annoying.

  • Nokia 8110 (1996)

    The Nokia 8110 was the first slider phone and was featured in the Matrix, resulting in a generation of slick idiots pretending to be Neo when picking up calls from their mum.

  • Nokia 9000 Communicator (1996)

    Nokia claims that was the 'world's first smartphone'. That might be pushing it - but it certainly pushed the boundaries. It had a full QWERTY keyboard, a 24 MHz i386 CPU, could be used horizontally or vertically, and could send a variety of messages - including faxes.

  • Nokia 5110 (1998)

    The 5510 was one of the first phones with a replaceable cover - and also one of the first to feature Snake. Which, kids, was a game in the olden days which drove. Us. Mad.

  • Nokia 7650 (2002)

    The 7650 was promoted in conjunction with the film Minority Report, but was actually fairly futuristic for its time. Beyond its experimental looks, it came with Nokia's first full colour screen and a built-in camera. This phone made Nokia the largest manufacturer of digital cameras in the world, the company claims.

  • Nokia 7600 (2003)

    The notoriously awkward, and now notoriously awesome 7600 featured a teardrop design, and a fabulously difficult to use interface.

  • Nokia 1100 (2003)

    The 1100 is one of the best-selling consumer devices ever made - 250 million have been shipped worldwide, largely in the developing world, due to its sustainable design, cheap price and built-in flashlight and radio.

  • Nokia 7280 (2004)

    Alongside the 7600, the 7280 is one of the weirdest phones ever produced. It featured a screen that faded to a mirror when it was inactive and used a Navi-spinner in the place of a keypad.

  • Nokia N93

    Just look at it.

  • Nokia 8800 (2005)

    The 8800 was a self-consciously premium device which featured a brushed-metal body, fine-pitch glass and ball-bearings in the slider. You probably weren't able to afford one.

  • Nokia Lumia 800 (2011)

    The Lumia 800 and 900 are Nokia's flagship Windows Phone 7 devices. They've since shared a gold award from the Industrial Designers Society of America, and are widely seen as - in industrial design at least - among the most beautiful devices currently on sale.

  • Nokia Lumia 900 (2012)

    The Lumia 800 and 900 are Nokia's flagship Windows Phone 7 devices. They've since shared a gold award from the Industrial Designers Society of America, and are widely seen as - in industrial design at least - among the most beautiful devices currently on sale.

  • Nokia Asha 306 (2012)

    The Nokia Asha 306 brings a full-touch smartphone experience to emerging markets, and in the spiritual inheritor to the Nokia 1100.

Ballmer said:

"Bringing these great teams together will accelerate Microsoft's share and profits in phones, and strengthen the overall opportunities for both Microsoft and our partners across our entire family of devices and services."

Nokia and Microsoft first teamed up in February 2011 on the former's Lumia smartphones.

Stephen Elop, Nokia president and chief executive, will step down to become head of the Nokia devices and services business within Microsoft, returning to his former company.

He has been tipped as one of the front-runners to take over from Mr Ballmer, who plans to retire within a year.

Elop said the deal provides the "opportunity to accelerate the current momentum and cutting-edge innovation of both our smart devices and mobile phone products".

It is understood that Microsoft and Nokia have been in negotiations since the end of January.

The full statement announcing the news reads:

"Nokia and Microsoft have always dreamed big – we dreamed of putting a computer on every desk, and a mobile phone in every pocket, and we’ve come a long way toward realizing those dreams.

Today marks a moment of reinvention.

Nokia has an identity spanning 150 years of heritage, innovation, excellence, and change which began and will continue in Finland and around the world. From humble beginnings as a paper mill factory, to manufacturing rubber boots and car tires, and then to mobile phones, reinvention is in Nokia’s blood.

Nokia will now write its next chapter, focused on enabling mobility through its leadership in networking, mapping & location, and advanced technologies.

For Microsoft as well, today is a bold step into the future, a huge leap forward on our journey of creating a family of devices and services that delight people and empower businesses of all sizes.

Our partnership over the past two and a half years, which combined our respective strengths to build a new global mobile ecosystem, has created incredible results: award-winning phones and amazing services that have made Nokia Windows Phones the fastest-growing smartphones in the world.

Building on this successful partnership, we announced some important news today: an agreement for Microsoft to purchase Nokia’s Devices & Services business, to deliver more choices, faster innovation, and even more exciting devices and services to our customers.

Today’s agreement will accelerate the momentum of Nokia’s devices and services, bringing the world’s most innovative smartphones to more people, while continuing to connect the next billion people with Nokia’s mobile phone portfolio.

With the commitment and resources of Microsoft to take Nokia’s devices and services forward, we can now realize the full potential of the Windows ecosystem, providing the most compelling experiences for people at home, at work and everywhere in between.

We will continue to build the mobile phones you’ve come to love, while investing in the future – new phones and services that combine the best of Microsoft and the best of Nokia.

Nokia and Microsoft are committed to the next chapter.

Together, we will redefine the boundaries of mobility."